The Federal Government has introduced legislation to ban the installation of fixed-line copper from every new house built in greenfield estates in an effort to push fibre connectivity.
Under the Telecommunications Legislation Amendment (Fibre Deployment) Bill 2010, all greenfield developments will need to be capable of supporting fibre-to-the-premises and will not be allowed to install copper wiring without Ministerial permission. A greenfield development is one built from scratch with no prior infrastructure available. The Government is aiming to have the legislation in place by July 1, 2010.
Communications Minister, Senator Stephen Conroy, said it did not make sense for new houses to be fitted with copper technology when fibre technology was the way of the future.
“[This] allows us to target those estates where it is possible to have fibre now, while ensuring others have fibre-ready infrastructure installed so it is easier and cheaper to connect them later,” he said.
The explanatory note accompanying the legislation claimed Telstra had “welcomed the Government’s fibre in greenfields policy”. But it then acknowledged the move would “impact on…Telstra’s business” due to its strength in the copper infrastructure market.
“Because of its incumbency and role as the universal service provider, Telstra is generally called upon to install copper infrastructure. By contrast, as noted above, it faces competition in the supply of FTTP infrastructure,” the note stated. “Telstra is already well established in the FTTP market and is in a strong position to compete in the provision of fibre.”
But Telstra was less certain than the Government and would not provide outright support when contact by ARN.
“There are significant differences between the draft and the final Bill. We are reviewing the implications for Telstra, the broader telecommunications industry, developers and our customers,” a spokesperson said.
Ovum research director, David Kennedy, said the Government’s main fear was that an unseparated Telstra could offer cheap copper installations and services and draw customers away from the NBN.
“If negotiations between Telstra and the Government fail, then Telstra will be in competition with NBN Co,” he said. “If there’s no copper in those estates then Telstra won’t have an incumbency in those areas.
“One thing it means is that Telstra’s copper network will not be expanding geographically in the future if this bill gets passed.”
“It reflects the Government’s push towards a single fibre platform for the whole country. They see copper as an outmoded technology which they don’t want to continue investing in.”
But Kennedy was keen to add that installing fibre was a sensible approach and said greenfield developments often lacked the ducting required for both fibre and copper infrastructure.
“If anyone might be concerned it’ll be Telstra, but I think that everyone in the industry would agree that continuing to put copper into new estates is a practice of diminishing returns.”